Observe the nature of the beauty contest. It is not who you think is beautiful. You win only if your pick matches that of others. So, you had to guess what other people were guessing. And other people were doing the same thing. So, the contest was essentially about which face most people thought was beautiful! Confusing?
If you buy only on fundamentals, you pick a beautiful face without bothering about what others are thinking. You "know" that other people will eventually come to realise that the face you picked is indeed the most beautiful. So, they will also pick that face.
What about technical traders — those who use charts — to buy/sell stocks? The price charts are footprints of human behaviour. If your entire neighbourhood buys a stock and the price moves up, the technical trader may buy the stock as well as depend on the chart pattern.
In terms of the beauty contest, the speculators are those who pick a girl they think is beautiful and wish others would also do the same! Which group do you belong to?